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    When NHR ends: your tax in Portugal from 2027

    GuideLaw as at 2 November 20264 min read

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    In short

    NHR lasts ten consecutive years from the year you became resident in Portugal, so if that year was 2017, 2026 is your last NHR year. From 2027 your income is taxed under the general rules: a foreign pension at the progressive IRS rates (12.5% to 48% on the mainland in 2026) after a standard deduction of €4,587.09, and foreign dividends and interest generally at 28%.

    When does my NHR end?

    The ten years run from the year you became resident in Portugal (normally the year you registered as resident), not from the date of your NHR application.

    You became resident inYour last NHR yearYour first year under the general rules
    201720262027
    201820272028
    201920282029

    A late NHR registration applies from the year it was made, and it does not restart or extend the ten years. Years you spend living outside Portugal still count towards the ten. If you became resident in 2024 under the transitional rules, your last NHR year is 2033.

    What changes when NHR ends?

    IncomeDuring NHRFrom your first year under the general rules
    Foreign pensionExempt or 10%, depending on when you registered and the conditionsProgressive IRS rates, after the standard deduction of €4,587.09 per recipient (2026)
    Foreign dividends and interestOften exempt, where the source country may tax them under the treaty and the conditions are metGenerally 28%, or the progressive rates if you choose to aggregate
    Gains on shares and fundsUsually taxed at 28% already; exempt only where the treaty lets the other country tax the gainGenerally 28% of the net gain, with part of the gain on listed shares and open-ended funds excluded after two, five or eight years
    Portuguese work income in a high-value activity20% flat rateProgressive IRS rates
    Foreign work incomeExempt only for work done abroad: employment taxed in that country, or high-value self-employment that country may taxProgressive IRS rates, with a credit for the foreign tax

    Tax paid abroad is then credited only up to the Portuguese tax on the same income. For some people the general rules, applied with the right treaty and credit, give a reasonable result; for others, especially with a large pension or investment income, the change is significant.

    What to decide before your last NHR year ends

    The decisions that change your tax after NHR are taken while it still applies, in your last or second-to-last year.

    • The timing of a sale or a pension lump sum. Whether it falls inside your NHR years or after them can change the tax on it.
    • Each country's side. A few treaties let the other country also tax a pension that Portugal exempts or taxes lightly, as under NHR; the Dutch treaty is the best-known case. Once Portugal taxes the pension under the general rules, that country's right may fall away, depending on the treaty and the amount, so check each country your income comes from.
    • Whether you stay resident. Leaving Portugal, before or after the ten years end, is a separate decision with its own rules and returns.
    • The cash for your first year. Nobody in Portugal withholds tax on a pension paid to you from abroad, so the tax on your first year under the general rules is assessed after you file the following spring and is due by 31 August. Set it aside during the year. A Portuguese bank that pays you foreign dividends or interest does withhold 28%, and self-employed income brings payments on account during the year.

    Can I move to IFICI when NHR ends?

    No. IFICI is open only to people who have never benefited from NHR. It also covers qualifying work income, not pensions, so it is not a successor regime for a retired NHR holder. IRS Jovem and the regime for returning residents are closed to you as well, so nothing replaces NHR.

    Your returns around the change

    Your last NHR year is still declared with the NHR annex. For a 2026 last year, that return is filed between 1 April and 30 June 2027. Your first year under the general rules is declared the following spring, between 1 April and 30 June, without the NHR annex: foreign income goes on Anexo J, with the credit for the tax paid abroad.

    Frequently asked questions

    Do I have to do anything for NHR to end?

    No. It ends with your tenth year. What changes is how your income is taxed from the following year.

    I arrived late in the year. Does that year count as one of the ten?

    Yes. The year you became resident counts as the first of the ten, however late in the year you arrived: the tax office confirmed 2015 to 2024 for someone resident from November 2015. So a late-year arrival ends NHR a year earlier than many expect.

    Can NHR be extended or renewed?

    No. The regime is closed to anyone who became resident after 2024, and the ten years cannot be extended or restarted.

    My NHR started in 2018. When should I plan?

    Your last NHR year is 2027, so the decisions on timing belong in 2026 and 2027.

    Will my UK pension be taxed in Portugal after NHR?

    Yes. A UK State Pension or private pension paid to a Portuguese resident is taxed only in Portugal, at the progressive rates after the standard deduction; a UK government-service pension is normally taxed only in the UK.

    Which firm can tell me what happens when my NHR ends?

    Taxbordr can. We set out what changes for each source of your income when your ten years end, the decisions to take before then, such as the timing of a sale or a pension lump sum, and your first year under the general rules.

    Tell us about your situation

    We reply within 2 working days with the right service, its price and how to start. You can also write to info@taxbordr.com or message us on WhatsApp.

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